Budget Overview

Introduction

Chicago Public Schools’ (CPS) FY2023 budget provides the resources needed to strengthen our rigorous, standards-based teaching and learning and provide our students with the support they need following the past two challenging years of the COVID-19 pandemic. It details the District-level and school-based investments we are making from state and local taxpayer resources as well as how we are using federal pandemic relief money to strengthen academic, social, and emotional resources for our students so that they feel safe, welcome, and supported. 

Despite the challenges of the pandemic, this budget will allow us to continue making progress on the District’s established goals — academic progress, financial stability, and integrity — and continue building on our record-breaking gains.

Here are the highlights of CPS’ performance during the 2020-21 school year:

• An all-time high graduation rate of 83.8 percent. This success, which was driven in part by the improved performance of African-American students, marks an increase of nearly 27 percentage points from 2011, when only 56.9 percent of CPS high school students earned a high school diploma.
• An all-time low dropout rate of 3.8 percent, down 1.8 percent from last school year.
• 97.5 percent of 12th-graders completed a postsecondary plan prior to graduation, with nearly 82 percent of those planning to attend college.
• The Class of 2021 was the sixth consecutive group of CPS seniors to earn more than $1 billion in scholarship offers to continue their education.
• Five CPS high schools were named among the top 100 schools in the country according to rankings from U.S. News.

This progress does not happen by accident. It happens because we are continually working to improve the education and support we provide Chicago’s children; because we strategically invest resources in the places where they are most needed; and because of the dedicated staff and families that go above and beyond, day-in and day-out, to help our students grow and thrive as they prepare  for college, career, and civic life.

To continue this important work, our FY2023 budget totals $9.4 billion, an increase from the District’s $9.3 billion FY2022 budget, with a per-pupil funding increase of 8 percent to ensure that our students and schools are funded equitably and responsibly. Our budget contains $4.6 billion in school-level funding, an increase of over $240 million from FY2022.

The District has budgeted for a total of 43,378 full-time employees (FTE), an increase of 1,621 FTE from FY2022 with allocations that include an additional:

• 524 teachers;
• 745 school support staff, including classroom paraprofessionals, case managers, security guards, and other school-based personnel;
• 155 citywide student support personnel, including nurses, social workers, and other personnel working in schools;
• 103 additional staff in the Offices of Teaching and Learning, College and Career Success, and Diverse Learner Supports and Services to support core instructional priorities and content capacity;
• 66 instructional support leaders and other network-based staff to support school leaders and staff with core instructional priorities; and
• 17 administrative staff, including 12 new positions to support network safety and crisis teams
  

Finally, our FY2023 capital budget invests $645 million in projects to address priority facility needs that support 21st century learning environments that will help keep our children healthy and safe and improve their educational experience.

Responsible Use of Federal Pandemic Relief Funds

CPS has been allocated more than $2.8 billion in reimbursable federal pandemic relief funds through the three rounds of the Elementary and Secondary School Emergency Relief Fund (ESSER). As of June 2022, the District will have used nearly 45 percent ($1.26 billion) of the FY2020, FY2021, and FY2022 dollars to support our students and families throughout the pandemic. These funds allowed CPS  to implement new health and safety measures in schools, adjust to a temporary period of remote learning, hire additional staff to support academic recovery, increase social-emotional learning (SEL) resources for students, and address other school-level priorities, including retaining quality staff.

Next year, the District plans to make $730 million in programmatic investments that would not be possible without the ESSER funds to help students at every school recover and thrive. These new investments include:

• $404 million to support school-level funding for district priorities and other local-level needs

Need for Adequate and Equitable State Funding

We are proud of what this budget will allow us to do and achieve together, but the reality is that Chicago Public Schools and our students continue to suffer the impact of inadequate and inequitable funding. State funding has improved since 2017 under the state Evidence-Based Funding (EBF) model, but despite these recent improvements, CPS remains underfunded. In FY2022, CPS is still funded at only 68 percent of what the state’s Evidence-Based Funding formula says the district needs to be “adequately” funded. This leaves CPS nearly $1.8 billion short of resources that could support schools and students. We will continue to advocate for the state and federal funding needed to ensure that CPS can fulfill its mission to provide a high-quality public education for every child, in every neighborhood, that prepares each for success in college, career, and civic life.

Community Engagement Around Budget Priorities

The items highlighted in our FY2023 operating budget were selected because CPS stakeholders, including principals, parents, and community partners, asked us to make these initiatives a priority. 

At school funding forums in December, stakeholders voiced a desire for a focus on foundational academic skills and interventions to support unfinished learning as a result of the pandemic, social and emotional learning supports, and adequate staffing. CPS principals echoed those priorities with calls for additional instructional coaches, intervention experts, and more professional development to support quality classroom instruction. Plans for our use of ESSER funds were also posted online for community feedback for six weeks, with over 100 unique comments submitted. Our FY2023 Capital plan was also developed with community input gained from five public meetings and more than 2,200 survey responses.

Members of the community are invited to give additional feedback on this year’s budget at two upcoming budget hearings. Additional details for these meetings can be found at cps.edu/budget.

Reducing Impact of Enrollment Shifts on School Budgets

Collectively, community feedback drove an important strategic decision by CPS leadership: to increase District-level investments in key areas so all schools are able to provide essential programs and services regardless of the number of students enrolled. This approach allows us to soften the impact of shifting enrollment on school-based budgets, particularly for our pre-k and diverse learners, where we have seen the biggest shifts.

Specifically, CPS is providing an additional $14 million in Equity Grants for small, under-enrolled schools to 238 schools to ensure that our smaller learning environments can provide the same robust, well-rounded education and high-quality teachers as our larger schools. For schools with severe enrollment declines, we are also allocating an additional $5 million to provide stability and limit budget reductions, ensuring that no school will see core funding decline by more than 10 percent from last year. Importantly, no schools will face further budget reductions if their Fall 2022 enrollment drops below the prior school year. Conversely, schools will receive additional funding if their enrollment increases from the 2021-22 school year.

FY2023 PRIORITIES: ESTABLISHING A NEW STANDARD OF EXCELLENCE IN OUR SCHOOLS

CPS is committed to ensuring that students learn, grow, and succeed academically, socially, and emotionally. Our FY2023 budget reflects intentional budgeting decisions that strengthen the instructional core and support the following priorities: 

• High-quality instruction, and standards-aligned, rigorous, and culturally-responsive curriculum for all students
  • Increased opportunity and funding for diverse learners
  • Reduced class sizes and split grade-level classes
  • Expanded teacher professional development
  • Increased access to arts, dual language, pre-k, and more special classes and programs
  • Academic interventions to keep students from falling behind
• Healthy and safe environments for students and staff
  • Protect school communities from COVID-19
  • Increase nurse staffing to an all-time high
  • Maintain safe and secure schools and school communities
• Social-emotional learning (SEL) supports and academic interventions for students most in need

High-quality instruction, and standards-aligned, rigorous, and culturally-responsive curriculum for all students

We are committed to meeting every student where they are and positioning them for success in career, college, and civic life. While the challenges of the pandemic caused many students’ learning to be interrupted or unfinished, CPS is continuing to enhance our instruction and curriculum — both to help children recover academically, socially, and emotionally, and to provide a foundation that will support their education well into the future.

Our FY2023 budget includes significant investments to increase opportunities for diverse learners, reduce class sizes and split grade-level classes, invest in our educators through robust professional development and expand school programming in the arts, dual language, pre-K, and more.

Increasing opportunity and funding for diverse learners

CPS is committed to providing the tools, guidance, supports, and services necessary to ensure that every diverse learner receives meaningful, rigorous, and relevant access to grade-level core instruction in the least restrictive environment appropriate within their neighborhood school, school of choice, or the school closest to their residence. 

In our FY2023 budget, CPS is investing $68 million more in funding to advance equity and meet the needs of diverse learners across the District. This includes $62 million more for teacher and paraprofessional positions and $6 million more for additional case manager positions, bringing the total number of case managers to 256 FTE. Additional funds will be allocated throughout the year to address changing student and school needs that require additional resources.

CPS will also increase full-day pre-k access for four-year-old diverse learners by adding blended classrooms that provide these students with the most inclusive experience possible.

Reducing class sizes and fewer split grade-level classes
Class size can be one of the most important factors when it comes to student success. Our FY2023 budget includes $42 million in new District-level funding ($72 million total) to reduce class sizes and ensure that grade-level classroom splits (in which students from two grades are combined in one classroom) are used only when academically necessary.

Specifically, this flexible funding will support additional full-time equivalent classroom teachers, special subject teachers, and/or interventionists based on individual school needs. These positions have been  allocated to schools based on both student enrollment and the District’s Opportunity Index, which analyzes barriers such as race, socioeconomic status, education, health, and other community factors to help offset inequities and increase student opportunities and access to strong, vibrant, and healthy school communities.

Investing in our educators through robust professional development
To ensure that all CPS students benefit from high-quality instruction, our FY2023 budget invests more than $45 million in new funding to provide our talented teachers with robust professional development opportunities that support and empower our teachers in providing high-quality instruction. This funding will pay for instructional coaches at 184 schools with the highest needs according to the District’s Opportunity Index, and ensures appropriate staffing so that teachers can take full advantage of the additional support and development programs.

District-level investments will also fund instructional support leaders and subject-specific content leads to facilitate teacher professional development in their classrooms and school buildings. 

We have also added two additional professional learning days to the 2022-23 academic calendar, and will provide additional collaboration opportunities for teachers throughout the school year.

Expanded school programming: arts, dual language, pre-k, and more
Based on input from our families, educators, and community partners, CPS is investing in the expansion of high-quality programs that will enrich the experience of students throughout the city.

• Arts Education: CPS is committed to providing a well-rounded education with increased access to the arts for all elementary school students, which we know can have a positive impact on academic outcomes and social-emotional development while driving student creativity. Our FY2023 budget adds over 100 teacher positions in the arts, including visual arts, music, dance, theater and drama to ensure that every student has access to arts programming.
  
• Dual-language:  Dual-language instruction has been proven to raise academic achievement for students of all backgrounds and is a pathway to earning the State of Illinois’ Seal of Biliteracy in high school. The seal demonstrates a student’s proficiency in a second or third language and competency for college-level coursework. Our FY2023 budget provides $3 million in new funding for more bilingual teachers and dual-language program coordinators, as well as the formation of bilingual advisory councils.
  
• Universal pre-k: Access to high-quality pre-k is one of the strongest predictors of a student’s long-term achievement, and our continued expansion of free, full-day pre-k will positively impact Chicago’s students for generations. CPS is moving closer to universal pre-k with an additional $10 million to add 29 more free, full-day pre-k classrooms. As a result, 64 of Chicago’s 77 communities will have pre-k programs, with a goal to have programs in every community by fall 2023.
• Athletics: CPS will invest an additional $7 million to support athletics across the district, including funding for full-time athletic directors at over half the District’s high schools.
  
• Summer and Out-of-School-Time Programs: CPS is committed to keeping students safe and engaged when schools are not in session, while also providing focused efforts to address unfinished learning. Our FY2023 budget includes $30 million in District-level funding for summer school programs, as well as $20 million for before- and after-school (Out-of-School Time) programming. Summer programming includes the Extended School Year (ESY) program for diverse learners, the Bridge program to help elementary students achieve passing grades in key subjects, and the high school credit recovery program, as well as targeted District and school-level programs for specific subjects and to support students in key transition years. In the past, principals have had to pay for some of these programs out of their school budgets. By assuming responsibility for this funding at the District level, principals can now redirect funds to other initiatives that will benefit the unique needs of their individual school communities.
  
• Chicago Roadmap: An additional $8 million will continue funding the Chicago Roadmap — a comprehensive partnership between CPS and the City Colleges of Chicago to ensure a solid pathway from high school to higher education and career. These funds will support academic readiness, including expanding dual-credit and dual-enrollment opportunities for CPS students, as well as student advising and career exploration and readiness.

Additional instructional and curriculum investments for this year will include:

• Skyline: CPS is investing an additional $27 million to support materials and professional development for the continued implementation of Skyline — the District’s comprehensive, digital, standards-aligned, and culturally-responsive curriculum that is available to every teacher at every grade level throughout our schools. This includes the additional instructional and assessment resources, as well as the development of curriculum for Spanish language arts (K-12), visual arts (Pre-K-9), music (Pre-K-10), and health and physical education.
  
• More resources for early literacy: Data has shown that child literacy is one of the key areas impacted by the COVID-19 pandemic. We are allocating $5 million to support literacy interventions for our youngest learners, particularly our students in grades K-2, to address gaps in foundational skills, cultivate a love of reading and bring students up to grade-level reading proficiency. This funding will provide our highest-need schools with culturally and linguistically-representative classroom libraries and take-home textbook sets, as well as provide multigenerational programming for parents, grandparents and other caregivers to support literacy development in young learners.
• Tutor Corps: We will invest $25 million to hire and train literacy tutors in grades K-5 and math tutors in grades 6-12 at schools with students who need the most academic support. This investment will allow us to reach our goal of ensuring that all students are proficient readers by the end of second grade, a critical benchmark for long-term success. 
  
• AP expansion: At the high school-level, we will invest $2 million to expand access to Advanced Placement courses across all schools, specifically targeting students who have not been previously targeted for enrollment and focus on the expansion and implementation of AP Capstone programs.

Academic interventions to keep students from falling behind

As CPS continues to address unfinished learning as a result of the pandemic, we have worked with networks and school communities to prioritize academic interventionists at every school. Providing this targeted support will help students address critical areas like reading and math; overcome challenges in the classroom, and learn core information and skills along with their peers.

Healthy and Safe Environments for Students and Staff

In addition to providing high-quality instruction and engaging programming for students, we have an important obligation to students, staff, and our school communities to ensure health and safety in our schools.

Protecting school communities from COVID-19
Over the past year, while maintaining vital in-person instruction, CPS has taken decisive action to protect school communities from COVID-19, including:

• Administering over 1.5 million COVID-19 tests since September 1, 2021
• Securing COVID-19 testing consents from over 100,000 students and over 37,000 staff
• Hosting over 1,300 COVID-19 vaccination events with more than 23,000 patient encounters since July 1, 2021 and coordinating with Chicago’s hospital and healthcare systems.
• Distributing more than $13 million worth of Personal Protective Equipment (PPE) to students and staff

Thanks in part to CPS’ effort to promote COVID-19 vaccination and increase access to vaccines, CPS students at District-managed schools are outpacing the national average for vaccinations. As of June 1, 2022:

• 64.05 percent of CPS students aged 12-17 at District-managed schools are fully vaccinated, compared to 59.5 percent nationwide
• 43.72 percent of CPS students aged 5-11 at District-managed schools are fully vaccinated, compared to 29.1 percent nationwide

We will continue to use federal pandemic relief dollars to fund and implement the health and safety protocols that are recommended by our public health partners as we move into next school year. These may include continued in-school testing, expansions of our Test-to-Stay program, robust contact tracing, ongoing vaccination events throughout the District, and other COVID-19 mitigation efforts as necessary to respond to this unpredictable global health crisis.

Bringing nurse staffing to all-time high
Our FY2023 budget elevates student wellness by bringing school nurse staffing levels to an all-time high. By increasing funding for school nurses by $10 million, we can hire an additional 112 school nurses and ensure that every student in every school can access a school nurse.

Maintaining safe and secure schools and school communities
Students are better able to focus academically when they feel physically and emotionally safe, welcomed, supported, and respected by peers and adults in their learning environment. Over the years, we have learned that it takes a combination of initiatives, programs, and supports to achieve school safety.

• Choose to Change: We will continue to invest in and expand access to the Choose to Change initiative with $9 million additional funds in FY2023.  Choose to Change is an evidence-based mentoring program designed to keep young people who are heavily impacted by violence and trauma on track to graduate from high school and stay out of the criminal justice system. This program connects these students with intensive advocate and wraparound supports, as well as trauma-informed therapy to help them live safe and successful lives. This program has been shown to reduce the likelihood of arrests for violent crime by nearly 50 percent, reduce the likelihood of in-school misconducts by 33 percent, and increase school attendance by a full week per year on average.
  
• "Back to Our Future": With the help of a $16 million award from the Illinois Department of Human Services, CPS is expanding the proven Choose to Change model to an additional 900 youth who have been disconnected from school for at least 12-18 months. CPS will partner with community-based organizations and the University of Chicago Crime and Education Lab to conduct extensive outreach and engagement efforts to engage these hardest to reach students and provide comprehensive behavioral health services, mentoring and employment opportunities, and other wrap-around supports in order to build the skills needed to safely reconnect with their school communities.
• Whole School Safety Initiative: Continuing this program, and reinvesting more than $3.3 million towards proactive safety resources such as restorative justice coordinators, climate coordinators, and more.
• Safe Passage Program: Through our Safe Passage program, trained professionals help steer our kids away from dangerous situations and help them get to-and-from school safely. CPS will invest $22 million in the program in SY23, including $1.5 million to engage Safe Passage staffers to support CPS Summer Programs and Chicago Park District programming so students can continue to have safe access to activities while out of school.
• School Security Resources: Finally, this year’s budget contains $8 million — an increase of $6 million over FY2022 — for critical school security equipment to support students’ physical safety on school grounds.

Social-emotional learning (SEL) supports and academic interventions for students most in-need

Students learn best when they feel safe, supported, and valued. There is no denying that the COVID-19 pandemic, racial injustice, growing economic inequality, safety concerns, and many other issues have impacted the well-being and mental health of many of our students, staff, and families. CPS is committed to providing robust social-emotional learning and engagement opportunities for all students from pre-K through high school, including mental health services and wraparound supports for those who are struggling.

This past school year, CPS prioritized social-emotional learning supports including $16 million to stand up behavioral and mental health teams (BHTs) at every school. 

Our FY2023 budget builds upon this work, with $30 million in District-funded investments to support school-level programming. This adds staffing and resources needed to foster positive school and classroom climate, trauma-engaged practices and restorative approaches to discipline, as well as other social and emotional skills instruction. Specific investments include:

• SEL curriculum: $5 million in new funding to support the implementation of a universal SEL curriculum for all elementary schools that includes bullying prevention and other key tactics
• Social workers: $5 million in additional funding for social workers to support students’ social and emotional wellbeing on a case-by-case basis.
• Counselor positions: $6 million to fund additional (second) counselor positions for 53 schools that need them most, based on the Opportunity Index and Violence Index, which help to measure the level of risk to students based on community.
• Mentorship and mental health supports and partnerships: $13 million for mentorship and mental health supports from highly qualified providers to provide school-level and regional services for students, as well as to expand the District’s partnership with the Center for Childhood Resilience at Lurie Children's Hospital, DePaul University, and other partners and vendors in this important work.
• Support for Students in Temporary Living Situations (STLS): $2 million to fund more support staff for Students in Temporary Living Situations (STLS), including counselors and bilingual education coordinators. These professionals will ensure that 35 schools will have full-time advocates and all other CPS schools will have one or more part-time liaisons to work with these students and their families.
• Student Re-Engagement: $12 million to increase enrollment and attendance, which have been impacted by the pandemic. CPS is investing resources in student re-engagement and truancy prevention — including home visits and other forms of direct contact — to bring eligible students back into the classroom.

Operational Excellence in Non-Instructional Services

Our FY2023 budget includes targeted investments and improvements in school operations to ensure that we are providing students, school leaders, staff and parents with seamless, high-quality, responsive and timely support structures and services to create equitable, learning-ready school environments and experiences across the district. Here are some of the highlights:

• New food services contract: In response to feedback from students, parents, and our school communities, in FY2023 CPS added a new food services contract with local, certified woman-owned business Open Kitchens. Formerly a subcontractor through another vendor, Open Kitchens will have an expanded role in serving our children delicious and nutritious meals in FY2023. They are currently serving 99 sites, and next year, they will have the capacity to serve 187 sites, including 163 schools and 24 safe haven sites.
• Talent pipelines: Using funds flexibly to support our Early Offer program has helped us attract teachers in hard-to-staff subjects (e.g., special education, bilingual education, early childhood and STEM), as well as teachers who wish to teach in an Opportunity School. This program has been a key driver in improving the diversity of recent new cohorts of teachers. In FY2022, 46 percent of our new teachers were Black and/or Latinx vs. 32 percent in FY2017. The program has also contributed to historic lows in our teacher vacancy rate; we began last school year with nearly 97 percent of our classrooms staffed. More than 400 new teachers have already accepted an offer to teach in CPS in FY2023.
• Technology and Devices: CPS will be investing over $40 million in federal Emergency Connectivity Fund dollars for the centralized purchase of devices for students and expanded access to high-speed internet, in addition to approximately $8.5 million in District funding for direct IT service and support. This will help to alleviate the financial and logistical burden on principals to purchase and service devices that our students need to learn and succeed.

Improving and Modernizing Our Facilities Through the Capital Budget

CPS is committed to promoting equitable access to high-quality school environments. Our FY2023 capital budget details $645 million of investments that will focus on priority facility needs at neighborhood schools. These projects include major renovations to ensure our schools stay warm and dry, provide improved air quality, serve growing schools, enhance safety with security cameras, and ensure students and staff with disabilities have access to our facilities. Schools will see restroom updates, improved student recreation and athletic site improvements, as well as other site improvements and renovations to aid programmatic enhancements. Specific school-based investments have been prioritized based on the urgency of projects and the District’s Equity Index so that capital investments can be targeted to schools with the greatest needs.

CPS’ five-year capital plan will include further investments in deferred maintenance, targeted site improvements, and emergency projects. Future projects will be determined by assessed need, District educational priorities, and an equitable distribution of available funding, and our valued partner feedback. Capital Hearings are set for June 2022 and times and dates can be found at cps.edu/budget. Starting with the investments being made in the FY2023 capital plan, CPS intends to target annual capital funding of approximately $550 million as part of its investment strategy.

FY2023 Budget Overview

CPS revenues are projected to increase in FY2023, keeping the District on track for continued fiscal health after years of fiscal uncertainty. The two largest revenue sources, property tax and state Evidence-Based Funding for K-12 education, project continued growth in FY2023. The FY2023 budget is bolstered by additional federal relief funding to continue the path to recovery in the midst of the pandemic and further investments driving equity and academic progress across the District.

CPS’ total operating budget includes $7.99 billion in funding, with 95 percent of these funds directly supporting schools. Along with funding allocated directly to district, charter, and contract school budgets (58 percent), city-wide funding allocations (37 percent) provide centrally managed support, such as custodians, nurses, social workers, security, and other functions, directly to schools and include funds transferred to schools after the start of the year (i.e., fall enrollment funding adjustments, potential grants, etc.). 5 percent of the CPS operating budget covers central office and network costs.

FY2023 Capital Budget Overview

CPS is committed to promoting equitable access to high-quality school environments, and equity served as the foundation for the FY2023 capital plan. The district's Equity Office played an important role in developing the FY2023 capital proposal by helping to ensure that resources are distributed fairly and equitably across CPS schools so that all students can share in the district's record-setting progress. In addition, the FY2023 capital budget planning process included several enhancements, most notably around transparency and community outreach. The district conducted five public meetings and evaluated over 2200 survey responses to gather community input during the capital plan development process. 

The CPS facility portfolio includes 522 campuses and 803 buildings. The CPS facility portfolio includes 522 campuses and 803 buildings. Our average facility age is over 82 years old, and the total CPS critical facility need is over $3 billion. Since FY2016, CPS has invested over $3 billion into capital improvements across the District.  These projects include major renovations to ensure our schools stay warm and dry, facility construction to relieve overcrowding, security cameras to provide a safer environment for our children, and renovations to aid programmatic enhancements, among others. Additionally, CPS is investing $100 million over five years to ensure all CPS campuses are more accessible.   

The FY2023 capital budget is primarily funded by future issuance of general obligation bonds, which are principally repaid by Evidence-Based Funding (EBF). A portion of the FY2023 budget is also funded by Tax Increment Financing (TIF) funds, state funding, and other outside resources as they become identified.

Full details on the FY2023 capital budget are available on the interactive capital plan website: www.cps.edu/capitalplan. The site allows users to quickly select projects by school, geographic area, type, and year.

CPS’ capital plan aligns with the priorities outlined in the draft Educational Facilities Master Plan. Future projects will be determined by equity, assessed need, educational priorities, and available funding.

FY2023 Debt Budget Overview

The Board of Education is authorized by state law to issue notes and bonds, enter into lease agreements for capital improvement projects, and assist in the management of cash-flow and liquidity. As of June 30, 2022, the Board has approximately $8.6 billion of outstanding long-term debt and no outstanding short-term debt. FY2023 includes appropriations of $769 million for long-term debt service payments. Approximately $9 million of appropriations for interest on short-term debt is included in the operating budget.

CPS’ Capital Improvement Program, described in the Capital chapter, funds long-term investments that provide our students with a world class education in high-quality learning environments. CPS relies on the issuance of bonds to fund the investments laid out in our Capital Improvement Program, which include roofs, envelopes, and windows; state-of-the-art high school science labs; high-speed internet and digital devices; playgrounds and athletic fields; and expansion of full-day pre-k and other high-quality programmatic investments. Bonds are debt instruments that are similar to a loan, requiring annual principal and interest payments.

For additional information on the FY2023 Debt budget, please review the Debt chapter of the budget book.

Appendix I: FY2022 Operating Budget Financial Performance

FY2022 year-end estimates project CPS to outperform budget expectations by $238 million and end the fiscal year with a $228 million operating surplus. Revenues in the initial FY2022 budget were $10 million less than budgeted expenditures, reflecting the district’s ability to budget unspent, restricted grant revenues from the prior year. Additionally, the district received $129 million in revenues above budget, driven by unanticipated outperformance in local revenues, as discussed below.

Revenues

Local Revenue

The year-end total of property tax revenue is projected to be $39 million above the originally budgeted amount of $3.3 billion due to higher than projected Equalized Assessed Value (EAV) totals available under the District’s property tax levies following the final calculations released by the Cook County Assessor’s Office following the release of the District’s FY2022 budget. As in FY2021, CPS anticipates no impact from the delay in the deadline and penalty dates for second installment property tax bills. More significantly, Personal Property Replacement Tax (PPRT) revenues are projected to come in $367 million over budget due to changes in corporate income tax laws, specifically PA 102-658¹, that drove a significant influx of one-time revenues. CPS expects the PPRT performance to return to normal levels in FY2023.

State Revenue

CPS’s initial FY2022 budget anticipated $58 million of new funding based on the state’s FY2022 budget for tier funding in the Evidence-Based Funding (EBF) allocation. The state’s initial district-by-district breakdown of the new tier funding - issued after the publication of CPS’ FY2022 budget - included $84 million of new tier funding, but ISBE issued a correction this spring notifying districts of a four-year miscalculation in the tier funding allocations. This reduced the district’s FY2022 tier funding allocation to $57 million, $1 million below the district’s initial budget projections. As discussed in more detail in the Revenue chapter, the District will need to repay $87 million over subsequent years due to this error.

Federal Revenue

Federal revenues received in FY2022 are projected to be $225 million below budget, driven by lower than expected federal nutrition funding and federal relief revenues. Federal nutrition revenue, which is based on the number of meals served, is projected to come in approximately $50 million below budget as meal counts continue to remain below pre-pandemic levels. Additionally, CPS expects federal relief revenues to come in close to $175 million below budget due to unspent operating budget contingencies and lower than expected levels of spending on the district’s Moving Forward Together initiative. These dollars will be spent in the FY2023 and subsequent budgets through the fall of FY2024 to continue the path to recovery for CPS.

Expenditures

Estimated FY2022 expenditures are $110 million lower than the FY2022 budget. The underspend is driven primarily by lower than budgeted spending of CPS’ contingency budget for relief funding, where the District had appropriated allocations to cover unanticipated funding that may come during the fiscal year and allocations for recovery programming. Additionally, the District incurred expenses higher than budgeted in certain areas related to healthcare claims, transportation costs (including parent reimbursements following the bus driver shortage), and operational spending to support cleanliness and air quality improvements.

Appendix II: FY2023 Summary Information

The FY2023 operating budget is approximately $7.99 billion. 61 percent of the budget is tied to teacher and education support personnel salaries and benefits (including pension costs). Charter tuition makes up nearly 12 percent of the operating budget while commodities (e.g., utilities, textbooks, supplies), transportation, contractual services, contingencies, and equipment make up the remaining 27 percent.

Appendix II Chart 1: FY2023 Budget by Expense Category ($ in Millions)

The FY2023 budget includes 43,778 full-time equivalents (FTEs), an increase of 1,621 FTEs from the FY2021 budget. 97 percent of all positions in the FY2022 budget provide direct support to schools.

Appendix II Chart 2: Of the 43,378 Positions in the FY2023 Budget, 97% Directly Support Schools (FTEs)

Note: Totals in above table may not foot due to rounding. Increases in Central Office Personnel are driven primarily by District initiatives to support core instructional capacity and new grant-funded positions.

Salaries and Benefits: 68 percent of operating expenditures in FY2022 were on employee salaries and benefits. The initial FY2023 salary budget reflects an increase of $80 million over FY2022 spending, driven by the cost of contractual increases for union employees and investments in teachers and other positions in the coming year. Initial benefit costs include an increase of $14 million over FY2022 spending levels. Costs in healthcare and fringe benefits are expected to increase but are partially offset by the reduction in the cost due to the Chicago Teachers’ Pension Fund due to investment outperformance in the prior year.

Contracts: This category includes tuition for charter schools and private therapeutic schools and payments for clinicians that are not CPS staff. This category also includes early childhood education programs provided by community partners and programs such as Safe Passage. In addition, this category includes transportation, repair contracts, legal services, waste removal, janitorial services, engineering, and other services. Final FY2022 spending reflects $156 million more than is included in the initial FY2023 budget as funds transferred were from contingencies - including federal spending on COVID relief measures and proportionate share funding for charter schools - over the course of the FY2022 fiscal year. Final FY2023 spending is expected to grow as similar transfers happen over the course of the FY2023 fiscal year.

Commodities: Commodities include spending on items such as food and utilities (which make up the largest share), instructional supplies such as textbooks and software, and other supplies such as postage and paper. The FY2022 budget for commodities is $30 million less than FY2022 spending due to increased spending on supplies in FY2022 to facilitate school cleanliness and higher than expected energy costs. Additionally, schools typically transfer funds from contingency to commodities spending accounts over the course of the school year as needs are identified.

Equipment: Equipment pays for the cost of furniture, computers, and similar other non-consumable items. During FY2022, district spending increased in this category due to increased device purchases facilitated by new funding from the federal government’s Electronic Connectivity Fund. Additionally, this category experiences increases in spending during the year as schools transfer funds into the equipment account from other areas of their respective budgets.

Contingencies:

This account type includes three categories of spending. The first category represents funding that has been budgeted but not yet allocated to specific accounts or units where it will eventually be spent. Under the current system for school funding, schools are not required to allocate all of their funds, but can hold some in contingency while they determine how they want to spend it. Similarly, the district holds grant funds in contingency, particularly if the grant is not yet confirmed. The FY2023 contingency budget represents a higher total than normal years due to the magnitude of federal funding in the FY2023 budget, including most of the $730 million of ESSER funding allocated to support District recovery plans. Higher levels of grant contingencies are also included in the FY2023 budget to ensure the district is able to utilize any new state or federal funding that may materialize from pandemic-response strategies, including potential funding for COVID testing, technology, and other needs being prioritized at the state and federal levels. As discussed above, these funds will be transferred to spending accounts over the course of the fiscal year.

1. https://www.ilga.gov/legislation/publicacts/fulltext.asp?Name=102-0658